UAE's Draft electronic insurance regulations
Friday, 12 27 2019, Category: Insurance and Reinsurance, Country: U.A.E
Earlier this year, the Insurance Authority released draft regulations relating to Electronic Insurance (the Draft Regulations). While the Draft Regulations have not yet been implemented, there are certain proposed provisions which insurers and insurance professionals should be aware of.
The scope of the Draft Regulations is wide and covers all online insurance business carried out by insurers, brokers, agents and health insurance TPAs. The definition of Electronic Insurance Operations specifically includes not only the sale of insurance policies, the collection of premium and the handling of claims, but also the marketing of insurance policies.
A central feature of the Draft Regulations is the requirement to obtain pre-approval from the Insurance Authority in order to practice insurance online. As part of the application for pre-approval, the applicant must submit a specific action plan, setting out the following:
An analysis of the projected volume of Electronic Insurance Operations for the next three years;
An analysis of the risks associated with the proposed Electronic Insurance Operations, along with the measures proposed to mitigate against these risks; and
A contingency plan to be followed in case of disruption to Electronic Insurance Operations.
The IA must also pre-approve the classes of insurance products intended to be sold online.
In terms of oversight, entities carrying out online insurance business must establish an IT department within their organisation for managing online activity. While the management may be assigned to a third party (see below), any such assignment must be pre-approved by the Insurance Authority. Furthermore, a Communications Officer must be appointed who, among other things, is responsible for ensuring that the third party complies with the terms of the outsourcing contract and the provisions of the Draft Regulations/related legislation.
Source:
HFW